Why Wasn't Madoff's Auditor Peer Reviewed or Inspected?
CPA Journal, The › Vol. 79 Nbr. 5, May 2009
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Summary
On Mar 12, 2009, Bernard L. Madoff pleaded guilty to 11 counts of fraud, perjury, and money laundering connected with the largest Wall Street Ponzi scheme ever recorded -- a reported $65 billion. But since December 2008, attention has turned to David G. Friehling, Madoff's accountant. Friehling was arrested on Mar 19, 2009, and charged with securities fraud and with aiding the investment advisor fraud committed by Madoff. For the past 15 years, the firm had been telling the AICPA that it did not conduct audits. Prior to the Friehling case, New York was one of only six states that did not require accounting firms to be peer reviewed. According to a Mar 13, 2009, letter from the Public Company Accounting Oversight Board to the Securities and Exchange Commission (SEC), "recent revelations of high-profile frauds, such as the Madoff matter, have focused public attention on the use and quality of audited financial statements and other SEC filings of nonpublic broker-dealers."
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Why Wasn't Madoff's Auditor Peer Reviewed or Inspected?
On March 12, 2009, Bernard L. Madoff pleaded guilty to 11 counts of fraud, perjury, and money laundering connected with the largest Wall Street Ponzi scheme ever recorded a reported $65 billion. Madoff faces a potential prison sentence of 150 years. But since December 2008, attention has turned to David G. Friehling, Madoffs accountant Friehling was arrested on March 19, 2009, and charged with securities f...
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